This constant upward sale price trend in classic art pieces was noticed by someone at Time Magazine way back in the 1970's. They penned an article they called "The Death Throws of Expressionism" in which they examined in great detail the art investment business.
Drawing from that article (as I recall it
) they divided art investors into "new money" investors and "old money" investors. While new money investors pretty much bought anything that caught their fancy, old money investors were strategic in their art purchases. Several interviews underscored the difference between the 2 sets thinking and motivation.
New money folks were younger, were spending disposable income, were uneducated in the arts, were unconcerned (to a great extent) about the investment potential of their purchases and tended to buy art on the spur of the moment or because they knew other people who had bought from a particular artist (trendy purchase).
Old money investors were older chronologically, educated in art and art history, thought long and hard before buying an art piece and always considered the investment potential before purchasing. They also bought what they liked, but restricted that to "old masters". Why? They were asked.
The response was that recent "art" by "up and coming artists" was of very dubious investment value. Many young artists work in nontraditional media (urine, feces, dead animals, garbage, meat) or in nontraditional ways. Examples are such as a young female NY city artist whose 'art' was going in for repeated surgeries to alter various aspects of her body to match images of classic beauty from old master's paintings (like the Mona Lisa by Da Vinci and the Birth of Venus by Botticelli). She would then take the excised tissues and fat (several 'tummy tucks'), place samples in plastic boxes and sell them as her 'art'. ('new money' buyers bought it)
Another example is a painting by Joseph Albers that was a huge raw cotton canvas that he tilted and poured gallons of paint onto from each side such that there were several streams of coloured paint running across the canvas. MOMA purchased that piece in the 1960's for $38,000 US, by 1990 it had dry rotted right off the wall, was dead and gone.
The trend was tracked back to the Expressionists, though I place its beginning at Marcel Duchamp's entry of a very used Russian Army barracks urinal in a major European exhibition of contemporary art in the early 1900's thus founding the Dadaist movement.
http://en.wikipedia.org/wiki/Marcel_Duchamp
Dada means "anti - art" and has evolved into the contemporary "Conceptualist" movement (which I do not consider to be "art" either). While conceptualists embrace the 'anti - art' message of Dada, they initially included a philosophic goal of "separating art from money" to somehow "purify" it.
shrug: I never did quite understand that goal) After a period of not making "art" and not making "money" at that, they began to look for ways to get money for 'not making' art.
The bottom line is that they have succeeded in scaring many 'old money' investors right out of the contemporary art market. The Old Masters are all dead and gone. Old master's art then constitutes a limited number of art pieces, many of known bottom value (the previous sale price). Limited number of pieces = limited supply. Combine that with a continued 'old money' investor demand for proven investment grade art and the stage is set for the continued escalation of old masters art auction prices. Limited supply + continued demand = constantly escalating prices for classic traditional artworks.
